WB slashes Zim economic growth

HARARE – The World Bank (WB) has confirmed that the country’s economy is
dying, slashing the economic growth from 3,8 percent to 2,5 percent in yet
another dose of bad news for the millions of long-suffering Zimbabweans
who are struggling to make ends meet.

Last year, the WB downgraded the country from its list of improved
economies to the unflattering tier of struggling countries.

In its latest Global Economic Prospects released on Monday, the WB also
revised the country’s 2018 economic growth forecast to 1,8 percent from
the initially projected 2,4 percent, as the country would be holding its
watershed elections.

The Bretton Woods institution noted that political uncertainty and low
business confidence were weighing on investment.

“In addition, weaker-than-expected growth in advanced economies or in
large emerging markets could reduce demand for exports, depress commodity
prices, and curtail foreign direct investment in mining and infrastructure
in the region,” the WB said.

Economists yesterday told the Daily News that it was not surprising that
the WB had slashed the economic growth.

“We can expect modest growth in maize production but not so much from
cotton and tobacco production.

“The reduction in tobacco output will cancel out the increase in maize
production – in value terms,” economist, John Robertson told the Daily
News.

Analysts blame Zanu PF’s misrule and populist policies, such as its
disastrous fast-track land reforms and the controversial indigenisation
legislation for discouraging foreign direct investment inflows and causing
massive company closures that have pushed the country’s unemployment rate
above 90 percent, among a myriad other ills.

This latest development comes as Zimbabwe’s worsening economic situation
has seen President Robert Mugabe’s government fighting hard to contain
rising anger among long-suffering citizens who are struggling to get cash
from the banks.

Zimbabwe is in the grip of a worsening economic crisis which has also
witnessed a severe shortage of cash, including the recently introduced
bond notes.

Despite injecting more bond notes into the market, and recently increasing
their weekly importation of United States dollars by 50 percent, the
government continues to battle to stem the acute cash shortages, which
have seen desperate Zimbabweans besieging over-stretched banks, as they
despairingly try to withdraw their money.

The disappearance of the country’s surrogate currency from the market has
also often forced banks to give clients their cash in sackfuls of coins.

It has also seen banks limiting the amount of money both individuals and
companies can withdraw, sometimes to as low as $20.